 So now let me come to, as I said, my reflections about the development of this society, which are also reflections, in a way, on the development of our movement, so to speak. When I first envisioned the idea of this society more than 10 years ago, and at that time still a society without a name, I had personal experience with only two other societies from which I could learn. My first experience was with the Montpelerin Society, which Friedrich Hayek founded in 1947. During the 1990s, I was three times invited as a speaker to Montpelerin meetings in Cannes, in Cape Town, and in Barcelona, and each time with papers attacking democracy and egalitarianism, and defending monarchies versus democracies, and eviscerating the classical liberal idea of a minimal state as a self-contradictory thing, and propagating instead a stateless, anarcho-capitalist natural order. My appearance was considered somewhat scandalous, that is too irreverent, too confrontational, and also too sensational. Now whatever the function of the MPS may have been in the immediate aftermath of World War II, at the time of my encounter with it, I did not find it particularly to my liking. To be sure, I met many bright and interesting people there, but essentially Montpelerin meetings were junkets for free market and so-called limited think tank and foundation staffers. There are various professorial affiliates and protégés, and the principal donor financiers of it all, mostly from the United States, and more specifically from Washington, D.C. Characteristically, Ed Foyler, the longtime president of the Heritage Foundation, the major Republican Party think tank and intellectual shield to the welfare, warfare state politics of every Republican government administration, from Reagan to Bush, Jr., is the former MPS president, and more significantly, he has been its longtime treasurer. There had been skepticism concerning the Montpelerin Society from the very beginning. Ludwig von Mises, Hayek's teacher and friend, had expressed severe doubt concerning Hayek's plan simply in view of Hayek's initial invitees. How could a society filled with certified state interventionists promote the goal of free and prosperous Commonwealths? Despite his initial reservations, however, Mises did become a founding member of the MPS, yet his prediction turned out correct. Famously, at an early Montpelerin meeting, Mises would walk out denouncing speakers and panelists as a bunch of socialists. Essentially, this was also my first impression when I came in contact with the Montpelerin Society, and this impression has been confirmed since. The Montpelerin Society is a society in which every right-wing social Democrat can feel at home. True, occasionally, a few strange birds are invited to speak, but the meetings are dominated, and the range of acceptable discourse is delineated by certified state interventionists, by the heads of government-funded or connected foundations and think tanks, by central bank pay release, by paper money enthusiasts, and assorted international edu-crets and researcher-crets in and out of government. No discussion in the hallowed halls of the MPS of U.S. imperialism or the Bush war crimes, for instance, or of the financial crimes committed by the Federal Reserve, and no discussion of any sensitive race issue, of course. Not all of this can be blamed on Hayek. He had increasingly lost control of the MPS already long before his death in 1992, but then Hayek did have much to do with what the MPS had become, for as Mises could have known already then, and as would become apparent at least, or at last in 1960, with the publication of Hayek's Constitution of Liberty, Hayek himself was a proven interventionist. In the third part of his famous book, Constitution of Liberty, Hayek had laid out a plan for a free society so riddled with interventionist designs that every moderate social democrat of the Scandinavian-German variety could easily subscribe. When at the occasion of Hayek's 80th birthday in 1979, the then Social Democratic Chancellor of West Germany, Helmut Schmidt, sent Hayek a congratulatory note proclaiming, we are all Hayekians now, this was not an empty phrase. It was true, and Schmidt really meant it. Schmidt was a trained economist by the way. What I came to realize then was this, the deplorable development as judged from a classical liberal vantage point of the MPS was not an accident, rather it was the necessary consequence of a fundamental theoretical flaw committed not only by Hayek, but ultimately also by Mises with his idea of a minimal state. This flaw did not merely afflict the Montpelerin society, it afflicted the entire limited government think tank industry that had sprung up as its offspring since the 1960s throughout the western U.S. dominated world and for which the Montpelerin society had assumed the function of some sort of international. The goal of limited or constitutional government that Friedrich Hayek, Milton Friedman, James Buchanan and other MPS Grandes had tried to promote and that every free market think tank today proclaims as its goal is an impossible goal, much like it is an impossible goal to try squaring the circle. You cannot first establish a territorial monopoly of law and order and then expect that this monopolist will not make use of this awesome privilege of legislating in its own favor. And likewise you cannot establish a territorial monopoly of paper money production and then expect that the monopolist will not use its power of printing up ever more money. Limiting the power of the state once it has been granted a territorial monopoly of legislation is impossible. It is a self-contradictory goal to believe that it is possible to limit government power other than by subjecting it to competition that is by not allowing monopoly privileges of any kind to arise in the first place is to assume that the nature of man changes as a result of the establishment of government. Very much like the miraculous transformation of man that socialists believe to happen with the onset of socialism. That is the whole thing. Limited government is an illusionary goal. To believe it to be possible is to believe in miracles. The strategy of Hayek and the Montpelerin society then had to fail instead of helping to reform or liberalize the western states as they intended or maybe only pretended to do. The Montpelerin society and the international limited government think tank industry would become an integral part of a continuously expanding welfare warfare state system. Indicators of this verdict abound. The typical location of the think tanks is in or near the capital city, most prominently of course in Washington DC because their principal address C is the central government. They react to measures and announcements of government and they suggest and make proposals to government. Most contexts of think tankers outside their own institution are with politicians, government bureaucrats, lobbyists, assorted staffers and assistants. Along with connected journalists these are also the regular attendees of their conferences, briefings, receptions and cocktail parties. There is a steady exchange of personnel between think tanks and governments and the leaders of the limited government industry are frequently themselves prominent members of the power elite and the ruling class. Most indicative of all, for decades the limited government movement has been a gross industry. Its annual expenditures currently run in the hundreds of millions of dollars and billions of dollars likely have been spent in total since these institutions came into existence. All the while state expenditure never and nowhere fell, not even once, but instead always and uninterruptedly increased to ever more dizzying heights. And yet this glaring failure of the industry to deliver the promised good of limited government is not punished but perversely rewarded with still more ample funds. The more the think tanks fail the more money they get. The state and the free market think tank industries us live in perfect harmony with each other. They grow together in tandem. For limited government advocates such as Hayek and the entire free market think tank industry this is obviously an embarrassment. They must try to explain it away somehow as accidental or coincidental. And they typically do so simple enough by arguing that without their continued funding and operations matters would have been even worse. Thus excused then the industry continues on as before undisturbed by any fact or event past or future. But the embarrassing facts are not accidental or coincidental and could have been systematically predicted if only one had a better understanding of the nature of the state and did not believe in miracles. As a territorial monopolist of legislation and the money printing press the state has a natural tendency to grow, to use its fiat laws and its fiat money to gain increasing control of society and social institutions. With fiat laws the state has a unique power of threatening and punishing or incentivizing and rewarding whatever it pleases and with its fiat money it can buy up support, bribe and corrupt more easily than anyone else. Certainly an extraordinary institution such as this will have the means at its disposal legal and financial to deal with the challenge posed by a limited government industry. Historically the state has successfully dealt with far more formidable opponents such as organized religion for instance. But unlike the church or churches however the limited government industry is conveniently located and concentrated at or near the center of state power and the industry's entire raison d'être is to talk and have access to the state. That is what its donors and financiers typically expect. Yet so much the easier than was it for the state to target and effectively control this industry. The state only had to set up its own bureaucracy in charge of free market relations and lures the limited government NGOs, non-governmental organizations with conferences, invitations, sponsorships, grants, money and employment prospects. Without having to resort to any threats these measures alone were sufficient to ensure compliance on the part of the free market think tank industry and its assorted intellectuals. The market demand for intellectual services is very low and fickle and hence intellectuals can be bought up cheaply. Moreover through its cooperation with the free market industry the state could enhance its own legitimacy and intellectual respectability as an economically enlightened institution and thus open up still further room for state growth. Essentially as with all so-called non-governmental organizations the state managed to transform the limited government industry into just another vehicle for its own aggrandizement. What I learned from my experience with the Montpelerin Society then was that an entirely different strategy had to be chosen if one wanted to limit the power of the state. For socialists and social democrats it is perfectly rational to talk and seek access to the state and to try marching through its institutions because the left wants to increase the power of the state anyway. That is the left wants what the state is disposed to do on its own by virtue of its nature as a territorial monopolist of law and order. But the same strategy is inefficient or even counterproductive if one wants to roll the power of the state back regardless of whether one wants to roll it back completely and establish a stateless natural order or roll it back only sharply or drastically to some glorious or golden status quo under. In any case this goal can only be reached if instead of talking and seeking access to the state the state is openly ignored, avoided and disavowed and its agents and propagandists are explicitly excluded from one's proceedings. To talk to the state and include its agents and propagandists is to lend legitimacy and strengths to it. To ostentatiously ignore, avoid and disavow it and to exclude its agents and propagandists as undesirable is to withdraw consent from the state and to weaken its legitimacy. In sharp contrast to the Montpelerin society and its multiple offspring then that wanted to reform and liberalize the welfare warfare state from within by pursuing a system imminent strategy of change as Marxist would say and that failed precisely for this reason and was instead co-opted by the state as part of the political establishment my envisioned society the PFS was to pursue a system transcending strategy that is it would try to reform and hopefully ultimately revolutionize the ever more invasive welfare warfare state system from the outside that is through the creation of an anti-statist counter culture that would attract a steadily growing number of defectors of intellectuals educated laymen and even the much sworn to man on the street away from the dominant state culture and institutions the PFS was to be this international spare head the avant-garde of this intellectual counter-culture central to this counter-culture was the insight into the perversity of the institution of a state a territorial monopolist of law and order that can make and change laws in its own favor does not and cannot without assuming miracles protect life and the property of its subjects but is and always will be a permanent danger to them the sure road to serve them and turn me based on this insight then the PFS was to have a two-fold goal on the one hand positively it was to explain and elucidate the legal economic cognitive and cultural requirements and features of a free stateless natural order and on the other hand negatively it was to unmask the state and showcase it for what it really is an institution run by gangs of murderers plunderers and thieves surrounded by willing executioners propagandists sycophants crocs liars clowns charlatans dupes and useful idiots and an institution and an institution that dirties and taints everything that it touches now for purposes of full disclosure I must add this at the urging of my friend Jesus Huerta de Soto who had been co-opted at a very young age into the Montpelerin society by Hayek personally I reluctantly applied for membership sometime in the mid 1990s besides Huerta de Soto the late Arthur Selden who was then honorary president of the Montpelerin society had endorsed my membership nonetheless I was turned down and as I must admit deserve at least so because I simply did not fit into such a society now for from reliable sources I have been told that it was in particular Leonard Ligio a former friend of Mary Ross Barts who must have realized this and most vigorously opposed my membership seconded from the German contingent of MPS movers and shakers by Christian Vatrin both Ligio and Vatrin would later become MPS presidents maybe as a reward for this my second experience with intellectual societies was with the John Randolph Club which had been founded in 1989 by the libertarian my mentor Murray Ross Bart and the conservative Thomas Fleming from the outset this society was far more to my right for a while I played a leading role in the John Randolph Club but I also played a prominent part in its breakup that occurred shortly after Ross Barts death death in 1995 and that essentially resulted in the exit of the Ross Bartian wing of the society nonetheless I look back to those early John Randolph Club years with some fond fond memories so it is no surprise that quite a few of my old JRC buddies and comrades have also appeared here in boardroom Peter Brimelow, Tom Di Lorenzo, Paul Guthrie, Walter Block because of illness of his wife couldn't come this time Justin Raimondo, Yuri Maltsev, David Gordon and in addition I should mention my friend Joe Sogren who had wanted to appear at our inaugural meeting but couldn't attend because of ill health. In contrast to the international Mont Pelerin society the Randolph Club was an American society this did not mean that the GRC, the Randolph Club was more provincial however to the contrary not only had the Randolph Club numerous foreign members but whereas the Mont Pelerin society was dominated by professional economists the Randolph Club represented a much broader interdisciplinary and transdisciplinary spectrum of intellectual interests and endeavors on the average foreign language proficiency among Randolph Club members ranked well above that counter in Mont Pelerin society circles in its habits and ways the Mont Pelerin society was multicultural, egalitarian and non-discriminating all the while it was highly restrictive and intolerant regarding the range of permissible subjects and the full of intellectual taboos in sharp contrast the Randolph Club was a decidedly bourgeois, anti-egalitarian and discriminating society but at the same time a society far more open and tolerant intellectually without any taboo subjects and in addition whereas Mont Pelerin society meetings were large and impersonal they could exceed 500 participants Randolph Club meetings had really more than 150 people attending they were small and intimate I like all of these aspects of the Randolph Club I didn't much care for the venues of the meetings of the Randolph Club typically some business hotel in the outskirts of a major city in this regard of course the Mont Pelerin society had clearly more to offer although for a very very stiff price but as I indicated not all of not all was well with the Randolph Club either and my encounter with it also taught me a few lessons on what not to imitate the break up break up of the Randolph Club shortly after Rosebard's death had partly personal reasons Tom Fleming the surviving principal of the club is to put it diplomatically a very difficult man as everyone who has dealt with him can testify I can say more private about this in addition there was some organizational quarrels the meetings of the Randolph Club were organized annually alternating by the center of libertarian studies which represented Murray Rosebard and his men and by the Rockford Institute which represented Thomas Fleming and his men this arrangement had perhaps unavoidably led to various charges of free loading ultimately however the break up had more fundamental reasons than just personal ones the Randolph Club was a coalition of two distinct groups of intellectuals on the one hand there was a group of anarcho-capitalist Austro-libertarians led by Rosebard mostly of economists but also of philosophers lawyers historians and sociologists mostly of a more theoretical analytical bend of mind I was a member of this group on the other hand was a group of writers associated with the conservative monthly chronicles a magazine of American culture and its editor Thomas Fleming Paul Gottfried was a member of that group the conservative group did not have any economists of note and generally displayed a more empirical bend of mind apart from historians and sociologists it included in particular also men of letters of philologists literary writers and cultural critics on the libertarian side the cooperation with conservatives was motivated by the insight that while libertarianism might be logically compatible with many cultures sociologically it required a conservative bourgeois core culture the decision to form an intellectual alliance with conservatives then involved for the libertarians a double break with the establishment libertarianism as represented for instance by the Washington D.C. free market Kato Institute this establishment libertarianism was not only theoretically in error with its commitment to the impossible goal of limited government and centralized government at that it was also sociologically flawed with its entire bourgeois indeed adolescent so-called cosmopolitan cultural message of multiculturalism and egalitarianism of respect no authority of live and let live of hedonism and libertinism the anti-establishment austral libertarians sought to learn more from the conservative side about the cultural requirements of the free and prosperous commonwealths and by and large I think they did and learned their list at least I think that I did for the conservative side of the alliance the cooperation with the Austrian anarcho-capitalist signified a complete break with the so-called neo-conservative movement that had come to dominate organized conservatism in the United States and which was represented for instance by such Washington D.C. think tanks as the American Enterprise Institute and the Heritage Foundation the paleo-conservatives as they came to be known opposed the neo-conservative goal of a highly and increasingly centralized economically efficient welfare warfare state as incompatible with the traditional conservative core values of private property of family and family households of local communities and of their protection there were some points of contention between the paleo-cons and the libertarians on the issue of abortion and immigration and on the definition and necessity of government but these differences could be accommodated in agreeing that their resolution must not be attempted on the level of the central state or even some supranational institution such as the United Nations but always on the smallest level of social organization that is on the level of families and of local communities for the paleo-cons the session from a central state was not a taboo and for the Austro-libertarians the session had the status of a natural human right while establishment libertarians such as the Cato Institute typically treat the session as a taboo subject hence cooperation with the conservatives and the libertarians was possible moreover the cooperation with the Austro-libertarians was to afford the conservatives the opportunity of learning sound Austrian school economics which was an acknowledged gap and weakness in their own intellectual armor especially vis-à-vis their neo-conservative opponents however with some notable exceptions the conservative group failed to live up to these expectations and this was the ultimate reason for the breakup of the libertarian conservative alliance that was accomplished with the John Randolph Club namely that while the libertarians were willing to learn their cultural lesson the conservative did not want to learn their economics this verdict and the consequent lesson was not immediately clear of course it was driven home only in the course of the events in the case of the Randolph Club the event had a name it was Patrick Buchanan a TV personality commentator syndicated columnist best-selling book author including some serious works on revisionist history a very charismatic man witty and was great personal charm but also a man was a deep and lasting involvement in republican party politics first as a Nixon speechwriter and then as a White House director of communications under Ronald Reagan pet Buchanan did not participate directly in Randolph Club meetings but he had personal ties to several of its leading members on both sides of the club but especially to the Chronicles group which included some of his closest personal advisers and he was considered a prominent part of the counter-cultural movement that was represented by the Randolph Club in 1992 Buchanan challenged then sitting President George Bush Bush for the GOP presidential nomination he would do so again in 1960 1996 when he challenged Senator Bob Dole for the republican nomination and again in 2000 he would run as a presidential candidate for the reform party now Buchanan's challenge was impressive at first nearly upsetting Bush in the New Hampshire primary and it initially caused considerable enthusiasm in Randolph Club circles however in the course of Buchanan's campaign and in reaction to it opened dissent between the two Randolph Club camps brought out regarding the correct strategy Buchanan pursued a populist America first campaign he wanted to talk and appeal to the so-called middle Americans who felt betrayed and dispossessed by the political elites of both parties after the collapse of communism and the end of the Cold War Buchanan wanted to bring all American troops back home dissolve the NATO leave the United Nations and conduct a non-interventionist foreign policy which has neo-conservative enemies smeared of course immediately as isolationist he wanted to cut all but economic ties to Israel in particular and he openly criticized the un-American influence of the organized Jewish American lobby something that takes considerable courage in contemporary America he wanted to eliminate all affirmative action and determination and quota laws that had pervaded all aspects of American life and which were essentially anti-white and especially anti-white male laws in particular he promised to end the non-discriminatory immigration policy that had resulted in the mass immigration of low-class third world people and the attendant forced integration or euphemistically multiculturalism further he wanted to end the entire cultural rot coming out of Washington DC by closing down the federal department of education and a multitude of other federal indoctrination agencies but instead of emphasizing these at that time widely popular rightist cultural concerns Buchanan in the course of his campaign increasingly intoned other economic matters and concern concerns all the while his knowledge his own knowledge of economics was rather skimpy concentrating on what he was worse at then he increasingly advocated a leftist economic program of economic and social nationalism he advocated tariffs to protect essential American industries and to save American jobs from unfair competition by foreigners and he proposed to protect middle Americans by safeguarding and even expanding the already existing welfare state programs of minimum wage laws unemployment insurance social security medicaid and medicare when I explained in a speech before the Randolph Club that Buchanan's rightist cultural and on the other hand his leftist economic program was theoretically inconsistent and that his strategy must consequently fail to reach its own goal that is that you cannot return America to cultural sanity and strengthen its families and communities and at the same time maintain the institutional pillars that are the central cause for the cultural malaise that protectionist tariffs cannot make Americans more prosperous but less and that the program of economic nationalism must alienate the intellectually and culturally indispensable bourgeoisie while attracting the for us and our purposes at least useless proletariat it almost came to an eclat the conservative group was up in arms about this critique of one of their heroes I had hoped that not withstanding feelings of friendship or personal loyalty after some time of reflection reason would prevail especially after it become clear by the ensuing events that Buchanan strategy had also failed numerically at the polls I thought that the Randolph Club conservatives would sooner or later come to realize that my critique of Buchanan was an imminent critique that is that I had not criticized or distanced myself from the goal of the Randolph Club and presumably presumably also Buchanan's own goal of a conservative cultural counter revolution but that based on elementary economic reasons I had simply found the means the strategy chosen by Buchanan to accomplish this goal was unsuitable and ineffective but nothing happened there was no attempt to refute my arguments nor was there any sign that one was willing to express some intellectual distance to Buchanan and his program from this experience I learned a twofold list first a lesson that I had already come away with from my encounter with the Montpelloran society was reinforced do not put your trust in politicians and do not get distracted by politics Buchanan not withstanding his many appealing personal qualities was still at heart a politician who believed in government above all as a means of affecting social change second and more generally however I learned that it is impossible to have a lasting intellectual association with people who are either unwilling or incapable of grasping principles of economics economics was logic of action is the queen of the social sciences it is by no means sufficient for an understanding of social reality but it is necessary and indispensable without a solid grasp of economic principles say on the level of Henry Haslitz economics in one lesson one is bound to commit serious blunders of historical explanation and interpretation thus I concluded that that the property and freedom society not only had to exclude all politicians and government agents and propagandists as objects of ridicule and contempt as emperors without clothes and the butt of all jokes rather than objects of admiration and emulation but it also had to exclude all economic ignoramuses when the JRC broke apart this does not mean that the ideas that had inspired its formation had died out or did no longer find an audience in fact in the United States a think tank dedicated to the same ideas and ideals had grown up in the meantime the Ludwig von Mises Institute founded in 1982 by Lou Rockwell was Murray Ross Bart as its academic head had started out as just another limited government think tank although Ross Bart and all other leading Mises Institute associates were themselves and are co-capitalist Austrians yet by the mid 1990s and I pride myself in having played an important role in this development do Rockwell had transformed the Institute which is significantly located far away from Washington DC in provincial Auburn Alabama into the very first and only free market think tank that had openly renounced the goal of limited government as impossible and come out instead as an unabashed advocate of anarcho-capitalism deviating thereby from a narrow literal interpretation of its namesake of Mises but staying in fact true to its spirit in pursuing the rigorous Misesian praxeological method to its ultimate conclusion this move was financially costly at first but under Rockwell's brilliant intellectual entrepreneurship it had eventually become an enormous success easily out-competing its far richer limited government libertarian rivals such as the Cato Institute in terms of reach and influence moreover in addition to the Mises Institute which focused more narrowly on economic matters and in the wake of the disappointing experience with the Randolph Club and its breakup new Rockwell had set up in 1999 an anti-state anti-war pro-market website new Rockwell dot com that added an interdisciplinary cultural dimension to the Austro libertarian enterprise and proved to be even more popular laying the intellectual groundwork for the present Ron Paul movement again a politician however. The property and freedom society was not supposed to compete with the Mises Institute or new Rockwell dot com it was not supposed to be a sink tank or another publication outlet rather it was to complement there and other efforts by adding yet another important component to the development of an anti-statist intellectual counterculture what had disappeared with the breakup of the original John Randolph Club was an intellectual society dedicated to the cause yet every intellectual movement requires a network of personal acquaintances of friends and comrades in arms to be successful and for such a network to be established and grow a regular meeting place a society is needed and the property of the property and freedom society was supposed to be precisely this society. I wanted to create a place where like-minded people from around the world would gather regularly in mutual encouragement and in the enjoyment of unrivaled and uncensored intellectual radicalism. The society was supposed to be international and interdisciplinary bourgeois by invitation only exclusive and elitist for the few elected who can see through the smoke screen put up by our ruling classes of criminals crooks charlatans and clowns after our first meeting five years ago here at the Carrier princess my plan became more specific still inspired by the charm of the place in its beautiful garden I decided to adopt the model of a salon for the property and freedom society in its meeting the dictionary defines the salon as a gathering of intellectual social political and cultural elites under the roof of an inspiring hostess or host party to amuse one another and party to refine their taste and increase their knowledge through conversation now take the political out of this definition and there you have it what I have tried to accomplish for the last few years together with Gülsün my wife and fellow Misesian economist without whose support none of this would be possible that is to be so what we want to be is to be hostess and host to a grand and extended annual salon and to make it with your help the most attractive and illustrious salon there is and I hope and indeed I am confident that this our fifth meeting will mark another step forward towards this end thank you very much